New Delhi [India], July 26 : India's residential real estate market saw a notable turnaround in June 2025, as housing sales (absorption) across the top eight tier-1 cities rose 2 per cent year-on-yearthe first annual growth in 12 months.
This uptick comes after declines of 11 per cent and 2 per cent in April and May, respectively, and is largely attributed to the base effect fading from the high absorption seen in April-May 2024. However, every quarter, sales were still down 4 per cent YoY.
According to a UBS report, city-wise sales trends were mixed. Delhi-NCR's prominent realty market Gurugram led the recovery with a 68 per cent YoY jump in volumes, followed by Chennai (24 per cent) and Hyderabad (15 per cent).
On the other hand, Mumbai Metropolitan Region (MMR) saw a 29 per cent decline in volumes, while Pune and Bengaluru recorded drops of 27 per cent and 6 per cent, respectively.
According to the analysis, despite volume moderation in some cities, housing prices continued to rise robustly. In June 2025, average absorption prices in top-tier cities surged 20 per cent YoY, compared to 10 per cent in May.
"Pricing growth remained firm across cities, aided by healthy inventory levels (driven in turn by calibrated supply)," the report added.
On a quarterly basis, prices were largely flat sequentially but still posted a solid 14 per cent YoY gain.
Gurugram again led the trends with a sharp 40 per cent YoY price increase, followed by Chennai (21 per cent) and Bengaluru (14 per cent). MMR, Pune, and Hyderabad recorded more moderate gains of 8-10 per cent, signalling continued pricing resilience despite varied sales performance.
The report observed that the new residential launches across major cities declined 12 per cent YoY in June, indicating a demand-calibrated approach by developers. As a result, the inventory-to-sales (I/S) ratio, which measures the amount of inventory developers are carrying compared to the number of sales orders being fulfilled across top cities, remained largely stable, rising slightly to 1.68x in June from 1.66x in Maywell below the peak of 3x seen during the downcycle.
Conversely, inventory levels in southern cities such as Hyderabad, Bengaluru, and Chennai increased YoY.
The data confirms expectations that YoY sales trends would improve starting June as base effects fade.
The UBS analysts maintain a positive outlook for MMR and Gurugram, citing strong price growth and controlled inventories, while expressing caution over Bengaluru and Hyderabad due to rising inventory ratios.
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